Correlation Between Datadog and Cheche Group

Can any of the company-specific risk be diversified away by investing in both Datadog and Cheche Group at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Datadog and Cheche Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Datadog and Cheche Group Class, you can compare the effects of market volatilities on Datadog and Cheche Group and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Datadog with a short position of Cheche Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Datadog and Cheche Group.

Diversification Opportunities for Datadog and Cheche Group

-0.7

Correlation Coefficient

Datadog  Cheche Group

Excellent diversification

The 3 months correlation between Datadog and Cheche is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Datadog and Cheche Group Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cheche Group Class and Datadog is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Datadog are associated (or correlated) with Cheche Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cheche Group Class has no effect on the direction of Datadog i.e., Datadog and Cheche Group go up and down completely randomly.

Pair Corralation between Datadog and Cheche Group

Given the investment horizon of 90 days Datadog is expected to generate 1.25 times more return on investment than Cheche Group. However, Datadog is 1.25 times more volatile than Cheche Group Class. It trades about 0.1 of its potential returns per unit of risk. Cheche Group Class is currently generating about -0.05 per unit of risk. If you would invest  11,342  in Datadog on May 11, 2025 and sell it today you would earn a total of  1,749  from holding Datadog or generate 15.42% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Datadog  vs.  Cheche Group Class

Datadog

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Datadog are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Datadog reported solid returns over the last few months and may actually be approaching a breakup point.

Cheche Group Class

Risk-Adjusted Performance

Weakest

Over the last 90 days Cheche Group Class has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Datadog and Cheche Group

The main advantage of trading using opposite Datadog and Cheche Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Datadog position performs unexpectedly, Cheche Group can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Cheche Group will offset losses from the drop in Cheche Group's long position.

The idea behind Datadog and Cheche Group Class pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.